I was recently asked if I could write about how to make money as a musician. More specifically, “…about setting up a small online business & ensuring that the websites for that business receive traffic.”I was recently asked if I could write about how to make money as a musician. More specifically, “…about setting up a small online business & ensuring that the websites for that business receive traffic.”
This person relayed the following to me: “I create music which many people say they enjoy listening to. This music is ideal for online selling through downloads or other methods. But as we both know, most people like to download music for free rather than pay for it! I don’t know how to surmount this hurdle, but I’m hoping that maybe you do.”
So we have some answers here about business in general, then online businesses, and finally a specific about the music industry.
Let’s look at the Generalisation, because it applies also to the specific.
The first thing you should do is decide whether you are in business or whether you are pursuing a hobby. The first is about generating a profit, the second is not. Both options require passion and outstanding capabilities to succeed in any spectacular way—otherwise you will be pursuing a third option which is the dilettante. It’s called time-wasting; among many other terms.
Second, if you are serious about being in business, you need a business model that shows how profit is to be generated. You also need a model of how you’re going to co-create product/service value for your customers. After all, who is going to pay you if there’s no value in it for them (what’s in it for me?), or if a competitor offers better value than you do?
Third, any business rests on a framework of four key elements:
● the technical side of your product/service; i.e. its usefulness to your customer
● the marketing of that use
● the operations side of mobilising your resources and capabilities
● the administration of your business
In each of these four areas you require competitive advantages in capabilities and resources. Author Richard Gordon once wrote, “For success in this life you need three things: brains, beauty and cash. If you’ve got one, then marry the other two.” It’s the same in business. You need four things to succeed. If you have one, then outsource the other three. Sooner or later you will outsource all four which will make you an owner of your business rather than a slave to your business.
Your business plan is about how you use your capabilities to co-create value. Without it, your most likely outcome will be wandering around in ever-decreasing circles. In the end, you’ll be gazing at the back-end, back where you started!
I was asked to look specifically at the marketing aspect of an online business and I will get to that (I say get your house in order first). You need to thoroughly adhere to legal and regulatory requirements. If you don’t, Murphy will ensure that just as you are going ‘gang-busters’, you get tripped up on a small technicality that initially seemed insignificant.
You need to have your financials recorded. Those records should give you simple-to-understand financial reports that tell you whether or not you are on track. You also need to handle the administration of your business: your staff, your property, your business licences, etc. Depending on the business, you are going to spend between several thousand (or more) to put all these bits together; so budget for that.
Next time we’ll continue with this same frame of thought on how to make profit out of something that’s free to you—like music.
CEO and Co-Founder
neXtep Business Builder Community Pte Ltd
Singapore ACRA Business Registration Number: 201424522Z
80 Kitchener Road #09-09/10 Singapore 208539